Navy Awards Austal $584 Million Contract To Build LCS-28

The Naval Sea Systems Command awarded Austal USA a $584 million contract to build the 28th Littoral Combat Ship (LCS), the Defense Department announced last Friday.

The contract for LCS-28 includes associated cost-plus-fixed-fee LCS class services and related material as well as firm-fixed-price integrated data environment support. The Navy highlighted this contract includes options to build an additional LCS, class services, and post-delivery availability support.

The USS Independence (LCS-2). Photo: U.S. Navy

The vessel is not to exceed the $584 million Congressional cost cap, according to the contract notice.

The Navy said information on that option-ship will be announced when the option is exercised

Austal USA along with Lockheed Martin [LMT] are the prime contractors for the Independence and Freedom variants, respectively, of the LCS. The Independence has an aluminum trimaran hull while the Freedom has a steel monohull.

Austal USA is part of Australia's Austal. The company said the contract will be the 14th LCS constructed at its Mobile, Ala., shipyard.

"We won this award following a direct competition with the Freedom-class LCS, which says much for our cost efficiency on this program," David Singleton, CEO of Austal, said in a statement. "Austal's work on the LCS program at our advanced Module Manufacturing Facility has seen efficiency gains of 20 per cent with an ambitious target of 35 percent set for the end of the build cycle."

The Navy also said it expects to release a competitive solicitation for additional LCS-class ships in future years and thus a specific contract award amount for those ships. The amount is considered source selection sensitive information.

This LCS contract is expected to be finished by Dec. 2022 and uses fiscal year 2017 Navy shipbuilding and conversion funding that is not to exceed the $584 million cost cap for one LCS. The Navy said 2016 funds of almost $6.6 million were also provided for LCS class services and integrated data environment support.

The Navy has five Independence-class LCS ships and the fifth, the USS Gabrielle Giffords (LCS-10), was commissioned earlier this month (Defense Daily June 9).

The FY 2017 omnibus appropriations bill provided for three LCS ships (Defense Daily, May 1). The Navy’s FY 2018 budget request included only one LCS, although the administration a day later indicated it supported a second which is expected to be announced in a list of budget errata (Defense Daily, May 24).